Future Growth: It's All About Mobile

If you don't have a mobile strategy, you don't have a growth plan.

If that sounds extreme, consider some of the latest data framing the emerging global mobile paradigm that is reinventing consumer orientation for every business in every industry. For starters, the 3,339 texts per month (or six per hour) traded by U.S. teens (4,050 texts per month for girls) reported by Nielsen this week suggest that mobility is a way of life.

Young adults 18 to 24 text about half as much, or an average three texts per hour. Texting is the primary reason that young consumers say they have mobile devices; it is easier and faster than making phones calls. This is a clear sign of permanent behavior change hinged on an unprecedented level of interactivity.

But data and apps are the real rising stars of the more than 85% of mobile handsets expected to be Web-connect by next year, according to mobiThinking. The number of people accessing the Internet from mobile devices will outpace the PC within five years. For consumers, it's all about the power of convenient connections and information.



Analyzing survey responses and cell phone usage, Nielsen says 94% of teens consider themselves advanced data users, using their cell phones for messaging, Internet access, multimedia, gaming, downloads and other activities. Downloading and using apps -- a shortcut to where they want to be and what they want to do -- is a rapidly rising second. Mainstream usage of mobile connectivity has surpassed activity on pre-installed games, ringtone downloads and instant messaging, Nielsen reports.

Even with some 233 mobile phone users in the U.S. (according to comScore) on par with the estimated 115 million domestic households that have at least one TV, mobile advertising is just $3 billion of the total $25 billion in total ad spending. While companies grapple with mobile ad solutions grounded in conventional ad practices, the real marketing magic will likely emerge as more interactive consumer pursuits.

For instance, the growing acceptance by users of touchscreen mobile devices such as iPads to make micropayments on the go suggests the development of sustained target marketing relationships punctuated by transactions -- advertising's endgame. Virtually half of consumers recently surveyed by Lightspeed Research say they are routinely making purchases for movie tickets, takeout food, travel and apps using their mobile phones.

Up to 50% of the world's mobile subscribers could be making payments by 2014.

Global mobile commerce is predicted to reach $119 billion by 2015, with Japan and other Asian nations leading the way, mobiThinking reports. In the U.S. alone, consumers already have ordered more than $1 billion in products from Amazon in the past 12 months using mobile devices, the company says.

What better place to be than in consumers' hands and heads? With 85% of all American owning a cell phone, about one-third of which are expected to be smartphones in 2011, the mandate is clear. Until that new mobile mindset becomes a strategic and operating priority, companies' growth prospects will lag.

There are signs that Google's entry into the mobile device arena with its Android operating system, now the most popular among recent smartphone users (according to Nielsen), may lure more advertisers to the other side. This week, Google said it expects to realize $1 billion in mobile revenues this year, or about 3% of its total revenues.

Apple locking horns with Google over fledgling mobile ad business could turn out to generate more sizzle than substance if consumers get more personalized, functional connectivity. Cold calls like 30-second advertising need not apply to mobile devices.

That said, too few companies in any industry get the mobile value proposition. Even fewer of the traditional and so-called new media players in the eye of the storm are innovating mobile consumer connections. And that makes the prospects for future growth more uncertain. For instance, the latest round of speculation about a Yahoo-AOL merger is absurd for many reasons, not the least of which is that neither of the early Internet companies has a particularly enterprising mobile strategy. Both are still fighting over nascent Internet advertising scraps. As long as media and Internet players maintain a death grip on their conventional notions of advertising, they will miss the opportunity to create and mine a new interactive hotline to consumers.

JP Morgan analyst Imran Khan makes the point that new ways of connecting with consumers -- apps, local geotargeted marketing and social networking -- embrace the interaction and transactions that mobile consumers clearly crave.

As mobile Web browsing continues to increase but fragment overall media consumption, the pathway to the consumer will be dictated by how they use their personal devices to manipulate their cars, appliances and homes while monitoring their finances, health, work and recreation.

Failure to grasp the interactive possibilities of mobile could be fatal. A lack of mobile leadership "could be detrimental for content aggregators and publishers," Kahn warns. "...failure to understand the mobile audience could lead to market share loss for producers and advertisers."

1 comment about "Future Growth: It's All About Mobile".
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  1. David Schreffler from Kony Solutions, October 21, 2010 at 6:05 p.m.

    Diane – great post. You’re right that the interactive possibilities of mobile offer a huge new market for businesses. However, companies are often overwhelmed when it comes to developing a mobile strategy. I work for Kony Solutions, and we hear companies refer to it as the “mobile headache.” And, with today’s new Forrester research report finding that half of all companies have less than one full time employee working on mobile initiatives, it’s not hard to see why brands aren’t fully grasping the possibilities inherent in mobile marketing. It’s crucial for marketers across all industries (including the media industry) to take advantage of free resources including white papers and webinars to educate themselves on how they can use mobile to improve sales and brand awareness, as well as on the technologies that exist to make it easier. Here’s a webinar on 2011 mobile planning that might also be helpful to your readers:

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